Canadian grocers' annual gathering gets underway in Toronto Monday amid some of the craziest times the industry has seen in years.

The battle to bag your supermarket business is more fierce in 2013 than it’s been in years, with grocers pulling out all the stops to get both price savvy and health conscious consumers through the checkout.

The virtual overhaul of food retailing this year is the backdrop to the Grocery Innovations Canada conference that starts Monday in Toronto.

Canada’s largest grocery industry trade show will host 5,000 retailers and experts who are dealing with recent mega mergers on the scene, rapid floor space expansion and new entrants to the once quiet sector.

“It’s a tough game to be in now,” says Kevin Grier, senior market analyst at the George Morris Centre in Guelph.

Some new items on offer among the 500 booths include a bottled HappyWater (containing natural lithium salts from Canadian springs), a frozen banana-flavoured treat with an edible gummy peel, a healthy fruit juice water enhancer and a “sustain lane” of eco-friendly products for fruit ripening and food disposal.

Premier Kathleen Wynne will also take part in a grocery bagging competition at the Metro Toronto Convention Centre against Joey Longo of Longo’s and representatives from Summerhill Market and sponsor Interac Monday at the two-day conference.

The grocery market has undergone big changes this year, with discount retailers Walmart and new entrant Target duking it out in the food aisles with established grocers like Loblaws, Sobeys and Metro.

It’s prompted the big players to get even bigger, with Loblaws taking over Shoppers Drug Mart and Sobeys’ merger with Safeway.

Everyone is waiting for big fish Metro to follow suit, with observers betting it will take a run at the Overwaitea chain of 120 stores in western Canada.

“The industry used to be peaceful place to set prices and make margins,” he says.

Not so now.

“Margins are more stressed and they (grocers) certainly know they can’t just hoist their prices and not expect to lose customers,” he says.

This year, the square footage of retail food floor space has increased 3.5 per cent – more than double normal levels.

“If supply outstrips demand then you have to lower prices to get people through the door,” adds Grier.

He notes that almost half of Canadian grocery shoppers now are buying things on sale, with a coupon or during a promotion.

While price chopping and online coupons are more the norm as consumer debt continues to rise, grocers are also clamoring for the higher-end market as consumers become more discerning about their food products and preferences.

Loblaws is set to open its first Nutshell “Live Life Well” store on King St. just west of Spadina Ave. in an effort to carve out a piece of the lucrative health and wellness pie. Its target is Whole Foods Market Inc., the world’s largest natural foods retailer based in Austin, Texas, which announced in June it hopes to open 40 new stores in Canada.

Further down on the food chain are the cost-cutting discount grocers, including Loblaws’ No Frills, Metro-owned Food Basics and Sobeys’ FreshCo, whose flyers boast more dollar deals and two-for-one promotions than ever, says Grier.

“It’s been a tough year for the grocery industry,” says Rob Gerlsbeck, editor of Canadian Grocer.

“Canadians have become more deal hunters. People have gotten used to things being on sale,” he says.

As a result, brand positioning – simply standing out -- has become more important than ever.

“Everyone is trying to differentiate themselves. (The question is) How do you define yourself,” says Grier.

Essentially the supermarket is being re-invented, with an emphasis on price at one end and a focus on local food and health and wellness at the other, adds Gerlsbeck.

A panel of industry players will discuss the future of online grocery retailing, which hasn’t really caught on in Canada the way it has in the U.K. But that could change with Amazon.com reportedly aiming to take a bite out of Grocery Gateway’s turf.

Considering all the activity in the sector: “Who knows what’s going to come next,” says Gersbeck.

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